Welcome to the August 2011 issue of the Cone Connection - your source for medical imaging news, product information and Cone promotions.

This month, we are addressing the latest Centers for Medicare and Medicaid Services' (CMS) action facing the medical imaging industry - CPT code bundling. While it's too early to begin to tally the numbers across the board, many independent imaging centers report that they have been hit with some pretty big losses in revenue. We'll look at why CMS has begun to bundle CPT codes, what effect it's having on medical professionals and patients alike, and how industry groups are fighting back. We'll also take a look at steps imaging centers can take to afloat with this this latest curveball thrown at them.

Our question of the month reviews the nationwide shortage of UPC-21L Sony print paper. What caused the shortage, and when does it look like stock will be back in?

Finally, we are coming near the end of our Imaging Table promotion. Got extra room in the budget? Need to upgrade? Save 5% now on our best imaging tables.

Thanks for being a valued Cone Instruments customer. We appreciate your business and look forward to being your source for medical imaging supplies, in 2011 and beyond.

The Centers for Medicare and Medicaid Services’ (CMS) revaluing and rebundling of CPT codes has sent shockwaves throughout entire medical industry, not just imaging. However, because the industry is largely compromised of smaller, independent imaging centers, the impact will be hard-hit to those practices already barely scraping by.

In this article, we’ll discuss why this practice is occurring, the effects felt by facilities, medical professionals and patients alike, and how industry groups and imaging centers are fighting back. We’ll also take a look at what practices can do to stay afloat during these rough waters.

Policy makers claim they are looking at misvalued codes, while many in the industry feel the motivation is purely to save money.

Whatever the truth is, here is how it works. CMS identifies multiple codes for procedures that are performed together regularly and combine them into a single code. Under the new single code, the Medicare reimbursement rates are typically reduced. At the beginning, CMS looked at codes that were billed 90% or 95% together; currently, they are targeting codes that are billed together 75% of the time.

But it doesn’t end with bundling. Policy makers are also looking at the fastest growing codes, codes that involve new technologies and services, are billed multiple times, etc. In the effort to reduce reimbursement rates, everything is fair game.

To illustrate how detrimental this policy can be to medical imaging, we’ll take a look at one instance of CPT code bundling.

CT of the abdomen and pelvis procedures, previously billed separately, were bundled in 2011. The new combined code is now paid at nearly the same rate as a single region code. “The reimbursement is down 25% for the professional component, and 50% to 65% for the technical,” according to Pam Kassing, MPA, RCC, Senior Economic Advisor on Economics and Health Policy for the American College of Radiology (ACR).

What does that mean in dollars? Each time you run these scans together, for the same reason and on the same service date, you can lose $200-$400 in reimbursement, depending on whether the test requires a contrast agent. Because this is a common procedure the many imaging centers perform hundreds or thousands of times in a year, it can result in significant lost revenue.

To make matters worse, big insurance carriers are following Medicare’s lead by imposing the new single-payment code for many newly bundled procedures for what was formerly reimbursed as a two-code exam.

The ACR presented data to policy makers that showed that even under a single code billing of Abdomen/Pelvis CT exams, physicians were still doing the same amount of work to interpret both exams. However, on average, radiologists are being pad 25% less to interpret bundled CT abdomen/pelvis exams under the new single code.

Because they, in essence, will be negatively rewarded, radiology professionals will be much more conservative in the scans it recommends for patients. The industry may see more single abdominal CT exam or pelvic CT exams performed instead of poorly paid combinations of the studies.

Bottom line - radiology professionals are going to work more for less income.

As a result of declining reimbursements, it’s expected that many imaging centers will close or sell their businesses to hospitals over the next 5-10 years. And although patients will still have access to imaging services, the access might not be as convenient or available as with outpatient facilities. Combine this trend with aging baby boomers and the new healthcare reform act bringing more patients into the system, this will put a strain on the medical imaging market.

Closed imaging centers are also adding to the glut of equipment and machinery available for sale, reducing the need for new systems from equipment manufacturers.

In the case of the CT Abdomen/Pelvis CPT Code bundling, the American College of Radiology (ACR) has opposed the move for the past five years, citing concerns over lost reimbursement, potential confusion over using new codes correctly and frustration that consideration wasn’t given to the physician time needed to read the scans. The ACR has actively campaigned for CMS to re-evaluate how the industry is reimbursed for the time a radiologist spends reading both abdomen and pelvis CT scans.

In addition to the ACR, the Radiology Business Management Association (RBMA) is also lobbying on behalf of radiologists.

Michael R. Mabry, RBMA’s executive director, says that one argument the RBMA is making to CMS is that bundling codes does not make sense clinically. There are legitimate clinical reasons to perform abdominal and pelvic exams together, and these reasons should not be overlooked when determining reimbursement for the procedures.

No imaging center should expect to come out of this unscathed. However, there are steps you can take to help alleviate the effects of bundled code revenue losses.

Ensure staff knows that the original codes may still be valid for procedures performed alone, which is true in the case of abdomen/pelvis CT scans. Post a chart indicating the old and new codes, as well as the circumstances in which you should use each one.

The ACR is not allowed to provide specific detail about CPT code changes, but they are allowed to inform radiology practices of what is being considered for bundling. When this information is released (see below for codes under consideration in 2012), evaluate how this may affect your business. Pull your facility’s annual frequency on the procedures that are being considered for bundling, and see how much your practice will be affected at different reimbursement reduction levels.

Until alternate payment models are implemented by CMS, the process of bundling will likely continue for the near future.

To help get you ready for next year, the ACR has recently listed the 5 code pairs that are under consideration for bundling in 2012:

• CT angiography of the abdomen and pelvis (74175 and 72191)
• Renal angiography with radiological supervision and interpretation (36245–35248, 75722, and 75724)
• Inferior vena cava filter placement and retrieval with radiological supervision and interpretation (37620 and 75940)
• Abdominal paracentesis with imaging guidance (49080, 49081, 76942, and 77012)
• Sacroiliac-joint injections with radiological supervision and interpretation (27096 and 73542)

On August 31st, the AMA will issue the new CPT codes for 2012, so you will have an idea of what will be bundled in 2012. The values assigned to the codes by CMS won’t be available until about November.

As stated above, take a look at how often you perform these procedures and begin to prepare your practice for these upcoming changes.

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